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Previous: AMERICAN NUCLEAR CORP, 10-Q, EX-27, 2000-08-21 |
Next: CARLYLE INDUSTRIES INC, 10-Q, 2000-08-21 |
Activa
Semiannual Report
June 30, 2000
Activa Money Market Fund
Sub-Adviser: JP Morgan Investment
Management, Inc.
Activa Intermediate Bond Fund
Sub-Adviser: Van Kampen Management, Inc.
Activa Value Fund
Sub-Adviser: Wellington Asset Management, LLP
Activa Growth Fund
Sub-Adviser: State Street Research &
Management Company
Activa International Fund
Sub-Adviser: Nicholas-Applegate
Capital Management
A selection of stock, bond, and money market funds, managed by professional
advisers, which are designed to help investors meet their financial goals.
LOGO: ACTIVA Mutual Funds
<PAGE>
Activa Mutual Funds Semiannual Report
Contents
Page
Shareholder Letter 1
Activa Money Market Fund 2
Activa Intermediate Bond Fund 2
Activa Value Fund 3
Activa Growth Fund 3
Activa International Fund 4
Schedule of Investments
Activa Money Market Fund 5
Activa Intermediate Bond Fund 7
Activa Value Fund 10
Activa Growth Fund 16
Activa International Fund 19
Page
Statement of Assets and Liabilities 24
Statement of Operations 25
Statement of Changes in Net Assets 26
Notes to Financial Statements 28
Financial Highlights 32
LOGO: ACTIVA Mutual Funds
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(616) 787-6288 (800) 346-2670
www.activafunds.com
<PAGE>
Semiannual Report
DEAR SHAREHOLDER
I am pleased to provide you with the Activa Mutual Funds Semi-Annual Report to
Shareholders for the period ending June 30, 2000. The first half of 2000 was
characterized by high volatility in the capital markets.
Stock markets lacked direction, with daily movements of over 2% both up and down
becoming common. While the economy and corporate earnings remained strong, fears
of rising interest rates and high valuations in the technology and
telecommunications sectors caused stock markets to remain flat or down for the
first six months of the year. The same elements influencing US markets spilled
over to international markets, which ended the first half of the year down as
well.
Bond markets fared better than stocks, posting small positive returns through
the end of June, despite several interest rate hikes by the Federal Reserve
during the first half of the year. Signs that the Fed's interest rate hikes were
beginning to slow the economy began to emerge in June. However, it remains to be
seen if this economic slowdown will be short-lived and if inflation remains a
threat.
Markets will probably remain volatile until investors are comfortable that the
economy is not growing at an inflationary pace. For specific details on how your
Funds performed over the last six months, please review the performance
discussion in the following pages.
The recent volatility in capital markets is a good example of why a diversified
portfolio (also called asset allocation) is the best strategy for reducing risk.
An asset allocation strategy invests funds in different asset classes, such as
cash, bonds, US stocks and international stocks, in one portfolio. As these
asset classes rise and fall independent of each other, gains in one asset class
can offset losses in another.
For example, during the last half of 1999, growth stocks soared while bonds
declined. An investor holding both bonds and stocks could have offset losses in
bonds with gains from stocks. During the first half of 2000, however, bonds rose
and growth stocks declined. That same investor could have offset losses in
growth stocks with gains in bonds. While this example only covers a one-year
period, the cumulative effect over the long term is that a diversified portfolio
has the potential to reduce the volatility of returns.
The Activa Funds have been especially designed to provide you with a diverse
family of funds so that you can implement an asset allocation strategy to suit
your investment objectives. If you have not already visited our website at
www.activafunds.com, I urge you to do so and explore some of the investment
tools provided. The questionnaires and calculators on our site will assist you
in identifying your investment goals, and help you formulate your investment
strategy.
We continue to evaluate new ideas to provide our shareholders with more
investment education, fund information and convenience. Thank you for your
continued support of the Activa Funds.
Sincerely
/s/ James J. Rosloniec
James J. Rosloniec
President
ACTIVA Mutual Funds Semiannual Report 1
<PAGE>
ACTIVA Money Market Fund -- J.P. Morgan Investment Management, Inc.
During the first quarter of 2000 the Federal Reserve remained vigilant in its
efforts to slow the U.S. economy, and the U.S. treasury announced that it would
institute a buyback program of longer-dated securities, reduce issuance, and
review the federal guarantee of Government Sponsored Entities (GSE's), or
agencies. The U.S. treasury curve flattened dramatically under these influences.
Spreads on non-treasury sectors came under pressure on the widening gap between
treasury and corporate supply. Additional pressure on spreads came in the form
of aggressive borrowing spurred on by productivity growth, putting upward
pressure on borrowing rates at the same time treasury yields were falling.
Strong economic data continued into April and the Federal Reserve responded with
a 50 basis point rate hike at the May FOMC meeting. A combination of corporate
bond rates approaching their 1994 highs, along with a lower equity market and a
vigilant Fed, have all conspired to dampen economic activity. The
underperformance of credit products continued into May as the Fed continued to
raise rates. Spreads did rally briefly after the 50 basis point rate hike, but
retreated on a month of record investment grade supply in June. Short dated
asset backed and CMBS securities were the outliers as they performed well
largely on low fixed rate supply. The U.S. treasury curve has disinverted in
response and the two year note is now trading through the fed funds target of
6.5%. The environment for spread product has also improved as market sentiment
suggests the FOMC is on hold for the near term.
For the six month period ending June 30, 2000, the Activa Money Market Fund
returned 2.81%. The barbell construction of the portfolio was maintained during
the first half of 2000. A significant portion of the maturities are invested in
short-dated securities while we look to opportunistically purchase longer
maturities on price declines. The significant concentration in floating rate
notes and allocation to asset-backed commercial paper directly attribute to the
excellent performance of the portfolio.
We will continue to look to add to our asset-backed holdings and modestly extend
the weighted average maturity of the portfolio as we believe economic data will
continue to point to a soft landing for the U.S. economy.
ACTIVA Intermediate Bond Fund -- Van Kampen Management, Inc.
For the first six months of 2000, the bond market total return moved back into
positive territory despite the continued Federal Reserve Board tightening. The
bond market benefited from the larger than expected US budget surplus and
subsequent Treasury debt re-purchase. In addition, the Federal Reserve Board's
tightening action provided comfort that future inflation will not materialize.
Both of these events led to significant declines in long term interest rates. At
June 30, 2000 the 30-year U.S. Treasury yield stood at 5.90% versus 6.48% at
year-end 1999.
The Activa Intermediate Bond Fund generated a total return of 2.83% versus the
Lehman Brothers Aggregate Index return of 3.99% for the six months ended June
30, 2000. For the same six-month period, U.S. Treasuries returned 5.37%. In
contrast to 1999, US Treasuries outperformed the non-Treasury sector for the
first six months of 2000. The mortgage, agency, asset-backed and corporate
sectors returned 3.67%, 3.58%, 3.35% and 2.68%, respectively.
As of June 30, 2000, the Activa Intermediate Bond Fund had a duration of 4.9
years, which was comparable to the 4.9-year duration of the Fund's benchmark,
the Lehman Brothers Aggregate Bond Index. With respect to relative sector
weightings, the Fund held overweight positions in the mortgage, asset-backed and
corporate bond sectors while maintaining underweight positions in the agency and
treasury sectors. We anticipate maintaining the current posture as we enter the
second half of 2000. Yield premiums in the non-treasury sector remain attractive
and present attractive total return opportunities.
2 ACTIVA Mutual Funds Semiannual Report
<PAGE>
ACTIVA Value Fund -- Wellington Asset Management, LLP
During the first half of 2000, the Activa Value Fund outperformed its Russell
1000 Value benchmark by 2.4%. The Fund returned -1.8% versus the benchmark's
return of -4.2%.
Most equity markets posted positive results early in the year, with small cap
stocks outperforming large cap stocks, and growth investment styles
outperforming their value counterparts.
Strong relative results achieved by the Fund during the first half of 2000 came
from positive stock selection in 9 out of 11 sectors, most notably in
Information Technology, Consumer Discretionary, and Health Care. Adverse results
were primarily due to poor stock selection in the Utilities sector, where the
Fund's holdings in telephone utilities detracted from performance.
We continue to seek broad diversification across economic sectors as a central
tenet of the Fund's investment strategy. We believe we are approaching the end
of rate hikes by the Federal Reserve, as there have been signs of slowing in the
US economy. In this tightening interest rate environment, we remain bullish on
the outlook for the large cap value sector and continue to look for
opportunities in large cap stocks that represent value through active portfolio
management.
ACTIVA Growth Fund -- State Street Research & Management Company
Through June 30, the Activa Growth Fund had a .18% return vs. the S&P500 which
was down -0.42%. The year began with an extension of the fourth quarter's strong
rally lead by the so-called "new economy" stocks (technology, biotechnology,
telecommunications, and internet- related companies). This rally was interrupted
in mid March by good old fashioned interest rate fears and valuation concerns. A
powerful correction brought many "new economy" stocks down (some with bear
market like price declines), and leadership broadened away from previous market
leaders.
By June, investors had started thinking about a slowing U.S. economy. That
raised hopes that the Federal Reserve might be nearing the end of its pattern of
raising the federal funds rate. Consistent with this, the Fed did not increase
rates at its June meeting and the market bottomed and began a recovery from its
lows representing a third trend reversal in stock price direction this year.
In this volatile environment, we have pursued a balanced portfolio structure
reducing significant sector over weights and focusing our efforts on those
individual companies that have, in the opinion of State Street Research's equity
analysts, highly visible prospects for delivering strong, consistent earnings
growth during a transition period for the economy. With respect to the
portfolio's investment returns, the volatility in the markets particularly in
May and June left the portfolio with returns ahead of the S&P 500 year to date.
As we moved through July, the strong earnings growth characteristics of the
portfolio paid off and returns are again (December 31 through July 31) further
above the market.
ACTIVA Mutual Funds Semiannual Report 3
<PAGE>
ACTIVA International Fund -- Nicholas Applegate Capital Management
During the first six months of 2000, equities overseas moved in tandem with the
USmarket, falling in response to concerns over rising interest rates, inflation,
and lofty valuations among technology stocks. The MSCI EAFE Index declined over
4% during this period.
Investor optimism over a resurgence in economic growth contributed to a 26.5%
advance for Japanese stocks during the period, as measured by the MSCI Japan
Index. However, in the first half of 2000, Japanese equities languished over
concerns about the sustainability of the budding economic recovery. European
stocks produced strong results during the period, particularly bourses in
Finland, Sweden, and France. Equity markets benefited from structural reform,
growth in the technology and telecommunications sectors, and economic expansion.
Amid a pick-up in GDP growth in many countries, the European Central Bank raised
interest rates a total of 1.75% on five separate occasions during the fiscal
year.
The Activa International Equity portfolio declined 12.6% for the first half of
2000, underperforming the MSCI EAFE Index which was down 4% for the period. This
is despite the fund's strong comeback during June.
Stock selection in Singapore, Canada and Sweden helped performance, especially
during June. However selection in Japan, the U.K. and the Netherlands negatively
impacted the portfolio. The underweighted position of the portfolio in the U.K.
relative to the MSCI EAFE detracted from performance during the first half of
the year.
Over the course of the fiscal year, on a stock-by-stock basis, we modestly
increased the portfolio's exposure to Europe while paring back holdings in the
Pacific Rim. We significantly increased our exposure to technology stocks,
demonstrating our belief in the sector's long-term growth potential. At the same
time, we trimmed holdings in the manufacturing, building materials, and
commodities industries.
International markets remain a source of attractive investment opportunities. In
Europe, productivity is rising and the economy is being transformed by a
restructuring wave that stands to boost corporate profits. Positive factors for
Japan include the developing technology industry and rising corporate
confidence, which results in increased capital equipment spending. And as aging
populations in both Europe and Japan plan for retirement, the demand for
equities should strengthen.
4 Activa Mutual Funds Semiannual Report
<PAGE>
ACTIVA Schedule of Investments
MONEY MARKET FUND 6/30/00 (Unaudited)
<TABLE>
<CAPTION>
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT 26.2%
ABBEY NAT'L CD 6.47% 01/10/01 500,000 499,874
BYRSCHE YCD 5.93% 10/02/00 1,000,000 999,555
BYRSCHE YCD MTHY 6.57% 12/15/00 3,000,000 2,998,836
DETCHBK 6.19% YCD 12/01/00 5,000,000 4,998,602
LANDBK, 7.14% 05/08/01 1,000,000 999,940
LLOYDS BNK, 7.2% 06/15/01 1,000,000 999,729
RABOBANK YCD, 6.66% 03/09/01 1,000,000 999,674
UNION BK YANKEE 6.24% 12/04/00 2,000,000 1,999,389
UNION BK YANKEE 6.39% 12/21/00 1,500,000 1,499,662
BNK AMERICA CD 6.75% 08/17/00 3,000,000 3,000,000
BANC ONE CD 5.93% 10/02/00 2,500,000 2,499,569
CA IMP BNK, 7.42% 06/04/01 1,000,000 999,738
COMMRZBNK CD FRN 6.59% 03/01/01 3,000,000 2,999,026
WESTDEUTSCH FRCD 6.57% 03/23/01 2,000,000 1,999,292
---------------
27,492,886
---------------
COMMERCIAL PAPER 30.1%
FMCC, 6.53% 07/20/00 1,000,000 996,554
FRST BOSTON 5.65% 08/21/00 2,000,000 1,981,158
FRST BOSTON, DPN 6.52% 07/10/00 1,000,000 998,370
UNBNK SWIS, 6.88% 04/30/01 750,000 749,882
US BANK MINN FRN 6.63% 04/04/01 1,000,000 999,671
GE CAPITAL, FRN, 6.22% 01/02/01 3,000,000 3,000,000
WSC ENERGY, 6.6% 07/18/00 1,000,000 996,902
ALPNE SCRTZN 6.6% 07/25/00 1,000,000 995,600
CIT GROUP DLY FLT 6.60% 2/14/01 1,000,000 999,450
EDISON 6.59% 07/26/00 1,000,000 995,424
EDISON, 6.6% 08/01/00 1,000,000 994,317
RECVLBS CAP 6.54% 07/10/00 2,000,000 1,996,730
REC CAPITAL, 6.6% 07/25/00 1,000,000 995,600
TRIDENT CAP 6.55% 07/11/00 1,000,000 998,179
GENERAL MILLS 6.68% 2/9/01 1,000,000 999,726
BAVARIA TRR, DCP 6.55% 07/11/00 1,000,000 998,180
QUEBEC, 6.67% 12/14/00 2,000,000 1,938,442
NTNWD BLDNG 6.6% 09/14/00 2,000,000 1,972,500
HD REAL ESTATE 6.8% 11/21/00 1,000,000 972,989
AT&T, 6.52% 07/12/00 1,000,000 998,008
BELLSOUTH, 6.51% 07/12/00 1,000,000 998,008
SBC COMM, 6.56% 07/20/00 1,000,000 996,538
SBC COMM, 6.62% 08/17/00 2,000,000 1,982,688
SBC COMM. 6.59% 09/06/00 1,000,000 987,735
WISC ENERGY 6.52% 07/11/00 1,000,000 998,189
---------------
31,540,840
---------------
FEDERAL HOME LOAN BANK 8.0%
FHLB 6.25% 07/03/00 3,449,000 3,447,802
FHLB VRN 6.13% 10/04/00 5,000,000 4,999,108
---------------
8,446,910
---------------
ACTIVA Mutual Funds Semiannual Report 5
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
MONEY MARKET FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
CORPORATE BONDS 34.3%
GMAC FRN 6.87% 03/30/01 1,500,000 1,501,643
BNK AMERICA, FRN 6.65% 06/06/01 1,000,000 999,907
BK AUSTRIA FRN 6.56% 02/16/01 4,000,000 3,998,770
BNK SCOT FRN 6.83% 03/05/01 3,000,000 2,999,901
CITICORP FRN, 6.68% 08/02/00 2,000,000 2,000,102
COMERICA BANK FRN 6.56% 2/14/01 3,000,000 2,998,948
FRST UNION, FRN, 6.68% 06/22/01 1,000,000 1,000,000
INTERAMERICAN BK 5.13% 02/22/01 1,000,000 991,267
NORWEST FIN, FRN 6.62% 07/20/01 1,000,000 999,489
CITIGROUP FRN 6.62% 04/04/02 1,000,000 1,000,000
AM. EXP. FLOATER 6.75% 07/12/00 2,500,000 2,499,957
CITI GROUP INC. 6.66% 01/19/01 3,000,000 2,998,950
CTRPLR QRTLY FLT 6.81% 09/15/00 3,000,000 3,000,388
FLEET FIN. VRN 6.34% 10/13/00 2,000,000 1,999,661
KEY CORP QTY FLT 6.83% 08/07/00 2,000,000 2,000,290
NAT'L CITY FLOAT 6.63% 10/04/00 2,000,000 2,000,000
AT&T CORP. FRN 6.57% 03/08/01 3,000,000 2,999,601
---------------
35,988,874
---------------
MEDIUM TERM NOTE 1.4%
MANITOBA 9.5% 10/01/00 1,415,000 1,424,378
---------------
TOTAL SHORT TERM OBLIGATIONS - 100% (Cost $104,773,932) 104,893,888
===============
</TABLE>
6 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments
INTERMEDIATE BOND FUND 6/30/00 (Unaudited)
<TABLE>
<CAPTION>
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C>
BANKERS ACCEPTANCES 0.9%
CANADA-GOV 6.375% 11/30/04 1,480,000 1,444,850
---------------
US TREASURY NOTES 0.3%
US T-NOTES 6.25% 04/30/01 500,000 499,215
---------------
US TREASURY STRIPS 3.2%
UST-STRIP PO 9.13% 5/15/18 6,225,000 2,065,766
STRIP PRINC 9.875% 5/15/15 7,975,000 3,166,713
---------------
5,232,479
---------------
FEDERAL HOME LOAN MORTGAGE 15.7%
FHLMC #C00785 6.5% 6/01/29 6,790,999 6,415,321
FHLMC #C27803 6.0% 6/01/29 4,866,114 4,461,594
FHLMC #C28180 6.5% 6/01/29 4,795,402 4,530,120
FGLMC #37237 8.0% 03/01/30 3,930,383 3,953,106
FHR 1702 PG 6.5% 12/15/22 2,500,000 2,382,362
FHLMC 6.5% 08/15/24 4,000,000 3,824,440
---------------
25,566,943
---------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION 19.5%
FNMA DN (6.51)% 08/17/00 540,000 535,534
FNMA DN (6.45)% 09/07/00 5,000,000 4,940,950
FNMA 6.625% 09/15/09 2,500,000 2,415,625
FNMA CMO 6.5% 09/25/23 5,000,000 4,815,475
FNMA 6.5% 09/18/24 2,800,000 2,663,864
FNMA #252715 6.5% 09/01/29 2,451,284 2,311,855
FNMA #481473 6.0% 02/01/29 3,361,047 3,076,400
FNMA #481427 6.0% 01/01/29 4,789,550 4,383,923
FNMA #490080 6.5% 03/01/29 2,377,014 2,241,809
FNMA #490179 6.5% 03/01/29 2,326,841 2,194,490
FNMA #496567 6.0% 04/01/14 2,441,859 2,311,366
---------------
31,891,291
---------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION 9.3%
GNMA #470387 6.5% 05/15/29 4,850,410 4,606,337
GNMA #486761 7.0% 12/15/28 2,974,321 2,894,371
GNMA #487201 7.0% 05/15/29 2,957,522 2,878,024
GNMA #490240 7.0% 09/15/29 4,920,205 4,787,951
---------------
15,166,683
---------------
CORPORATE BONDS - 51.1%
AIRLINES 0.6%
DELTA 10.125% 05/15/10 925,000 970,094
---------------
ACTIVA Mutual Funds Semiannual Report 7
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
AUTOMOTIVE 4.1%
BWA 8.0% 10/01/19 1,810,000 1,694,613
DAIMLER 7.20% 09/01/09 2,000,000 1,937,500
DAIMLERCHRY 7.4% 01/20/05 500,000 499,375
DANA CORP 7.0% 03/15/28 1,743,000 1,468,477
DELPHI 7.125% 05/01/29 1,250,000 1,075,000
---------------
6,674,965
---------------
BANKING 6.2%
BSCH ISS 7.625% 11/03/09 1,000,000 987,500
BANK ONE 6.00% 02/17/09 1,000,000 898,750
CHASE 6.66% 01/15/07 5,000,000 4,908,025
CHASE 7.125% 06/15/09 1,400,000 1,337,000
FIRST UNION 6.40% 04/01/08 1,400,000 1,267,000
NATL WEST 7.375% 10/01/09 650,000 632,125
---------------
10,030,400
---------------
BANKING AND FINANCIAL SERVICES 1.7%
BK OF AMER 7.8% 02/15/10 2,000,000 1,992,500
NAT AUST 8.6% 05/19/10 750,000 787,500
---------------
2,780,000
---------------
BEVERAGES 0.6%
J SEAGRAM 7.6% 12/15/28 1,000,000 948,750
---------------
CHEMICALS 0.9%
DUPONT 6.875% 10/15/09 1,500,000 1,460,625
---------------
ELECTRIC UTILITY 7.1%
PP&L TRANS 6.60% 03/25/05 4,000,000 3,964,820
PECO 1999-A 5.80% 03/01/07 5,500,000 5,228,575
S.CAR E&G 6.125% 03/01/09 1,500,000 1,380,000
WPS RESOURCES 7.0% 11/01/09 1,000,000 962,500
---------------
11,535,895
---------------
ENTERTAINMENT 0.7%
DISNEY 5.8% 10/27/08 200,000 185,500
VIACOM 7.75% 06/01/05 950,000 957,125
---------------
1,142,625
---------------
FINANCE 2.2%
VANDERBILT 7.82% 11/07/17 3,565,000 3,529,368
---------------
8 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
FINANCIAL SERVICES 21.1%
AMERICAN EXP 5.6% 11/15/06 4,450,000 4,218,199
ASSOCIATES CORP 04/20/04 3,500,000 3,281,250
CCIMT 6.65% 11/15/06 4,450,000 4,349,875
CONSECO 8.06% 05/01/31 2,810,000 2,764,380
FNCC 6.15% 09/15/04 1,250,000 1,226,863
FORD 6.40% 10/15/02 5,250,000 5,206,031
GMAC NT 5.75% 11/10/03 1,500,000 1,423,125
GMAC 7.375% 01/19/10 1,020,000 1,014,900
HALT 6.65% 07/15/05 5,000,000 4,964,800
SCAMT 6.35% 02/16/07 5,000,000 4,929,125
US WEST 6.375% 07/15/08 1,400,000 1,268,750
---------------
34,647,298
---------------
FOOD SERVICE 1.9%
KROGER 8.0% 09/15/29 1,650,000 1,575,750
SAFEWAY 7.5% 09/15/09 1,550,000 1,519,000
---------------
3,094,750
---------------
GAS UTILITY 0.6%
SOUTH UNION 8.25% 11/15/29 1,025,000 1,010,906
---------------
OIL & EXPLOR PROD & SER 1.9%
CHEVRON 6.625% 10/01/04 2,000,000 1,977,500
CONOCO INC. 6.95% 04/15/29 1,250,000 1,142,187
---------------
3,119,687
---------------
TELECOMMUNICATIONS 1.5%
MCI CORP. 6.50% 04/15/10 1,500,000 1,365,000
SPRINT CAP 6.875% 11/15/28 1,250,000 1,084,375
---------------
2,449,375
---------------
TOTAL FIXED INCOME - 100% (Cost $164,558,273) 163,196,199
===============
</TABLE>
ACTIVA Mutual Funds Semiannual Report 9
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments
VALUE FUND 6/30/00 (Unaudited)
<TABLE>
<CAPTION>
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C>
US TREASURY BILLS - 0.0% 0.0%
US T-BILL, 09/21/00 50,000 49,375
---------------
TOTAL US TREASURY BILLS (Cost $ 49,318) 49,375
---------------
COMMON STOCK - 100.0%
AEROSPACE 1.0%
UNITED TECHNOLOGIES 27,200 1,601,400
---------------
AIRCRAFT ENGINES & ENGINE PARTS 0.5%
HONEYWELL INTERNATIONAL 21,500 724,281
---------------
AIRLINES 0.9%
CONTINENTAL AIRLINES *7,400 347,800
SABRE HOLDINGS 1 29
SKYWEST, INC 9,200 340,975
SOUTHWEST AIRLINES CO. 28,200 534,037
U S AIRWAYS GROUP *7,500 292,500
---------------
1,515,341
---------------
AUTOMOTIVE 2.6%
FORD MOTOR CO DEL 45,000 1,935,000
GENERAL MOTORS CORP 7,821 454,107
GENERAL MOTORS - CLASS H *12,746 1,118,462
TRW, INC. 13,800 598,575
VISTEON CORP. *5,892 71,440
---------------
4,177,584
---------------
BANKING 11.7%
BANK ONE CORP. 45,400 1,205,938
CITIGROUP, INC. 107,900 6,500,975
KEYCORP 101,300 1,785,412
MERCANTILE BANKSHARES 69,900 2,083,894
PACIFIC CENTURY FINL 24,400 356,850
US BANCORP 123,300 2,373,525
UNIONBANCAL CORPORATION 37,800 701,662
WACHOVIA CORP. 66,500 3,607,625
---------------
18,615,881
---------------
BROADCASTING 1.9%
AT & T CORP.- LIBERTY MD 74,400 1,804,200
CLEAR CHANNEL COMM *5,400 405,000
SCRIPPS CO- CL-A 17,200 847,100
---------------
3,056,300
---------------
BUILDING PRODUCTS 0.3%
VULCAN MATERIALS CO. 11,300 482,369
---------------
10 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
Activa Schedule of Investments continued
VALUE FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
BUSINESS SERVICES 0.9%
FIRST DATA CORP. 28,400 1,409,350
---------------
CHEMICALS 1.9%
AIR PRODUCTS & CHEMICALS 20,000 616,250
DU PONT E I DE NEMOURS 31,200 1,365,000
GREAT LAKES CHEM CORP. 19,800 623,700
PPG INDUSTRIES, INC. 11,300 500,731
---------------
3,105,681
---------------
COAL 0.0%
ARCH COAL, INC. 7 54
---------------
COMMUNICATIONS EQUIPMENT 0.6%
AMERICAN TOWER CORP. *22,500 937,969
---------------
COMMERCIAL SERVICES 0.7%
CONVERGYS CORP. *21,400 1,110,125
---------------
COMPUTER SOFTWARE 0.3%
CABLETRON SYSTEMS *21,900 552,975
---------------
COMPUTERS 1.1%
ADAPTEC, INC. *25,900 589,225
QUANTUM CORP. *115,300 1,275,506
---------------
1,864,731
---------------
CONTAINERS & PACKAGING 0.3%
SMURFIT-STONE CONTAINER *31,000 399,125
---------------
ELECTRIC UTILITY 3.1%
CALPINE CORP. 21,600 1,420,200
DUKE ENERGY CORP. 9,900 558,113
MONTANA POWER CO. 13,600 480,250
PINNACLE WEST CAP. 36,700 1,243,212
UNICOM CORPORATION 32,000 1,238,000
---------------
4,939,775
---------------
ELECTRICAL & ELECTRONIC 0.4%
ENDESA 31,600 616,200
---------------
ELECTRICAL EQUIPMENT 1.8%
ATMEL CORP. 31,800 1,172,625
EMERSON ELECTRIC CO. 17,900 1,080,712
NEXTEL PARTNERS, INC. *19,900 647,994
---------------
2,901,331
---------------
ACTIVA Mutual Funds Semiannual Report 11
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
VALUE FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
ELECTRONICS 2.2%
NOVELLUS SYSTEMS, INC. 13,500 763,594
3COM CORP. *46,200 2,662,275
---------------
3,425,869
---------------
ENERGY 2.6%
DQE INC. 36,400 1,440,075
SUNCOR ENERGY, INC. 113,600 2,648,300
---------------
4,088,375
---------------
ENGINEERING 0.1%
FLUOR CORP. C/S 3,900 123,337
---------------
ENTERTAINMENT 1.8%
WALT DISNEY COMPANY 32,700 1,269,169
VIACOM INC. - CLASS B 23,800 1,622,862
---------------
2,892,031
---------------
FINANCIAL SERVICES 7.0%
FANNIE MAE 34,700 1,810,906
GOLDMAN SACHS 14,400 1,366,200
MERRILL LYNCH & CO. 45,600 5,244,000
WASHINGTON MUTUAL, INC. 90,900 2,624,738
---------------
11,045,844
---------------
FOOD & BEVERAGE 1.8%
SARA LEE COMMON STOCK 144,100 2,782,931
---------------
FOOD PRODUCTS 1.3%
MCCORMICK & CO., INC. 2,200 71,500
PROCTER & GAMBLE CO. 35,500 2,032,375
---------------
2,103,875
---------------
HOTELS & LODGING 0.5%
STARWOOD HOTELS & RESORTS 24,200 781,962
---------------
INDUSTRIAL GOODS & SERVICES 0.5%
CLOROX COMPANY 17,700 793,181
---------------
INFORMATIONAL SERVICES 0.2%
AFFILIATED COMPUTER SVCS. *11,500 380,219
---------------
12 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
VALUE FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
INSURANCE 8.5%
AMER INT'L. GROUP 33,700 3,959,750
CIGNA CORP. 30,500 2,851,750
MBIA, INC. 38,200 1,840,763
MARSH MCLENNAN COS COM 32,000 3,342,000
XL CAPITAL LTD. CLASS-A 27,500 1,488,437
---------------
13,482,700
---------------
MACHINERY & EQUIPMENT 1.4%
CATERPILLAR, INC. 21,400 724,925
INGERSOLL - RAND CO. 20,600 829,150
THERMO ELECTRON CORP. *30,500 642,406
---------------
2,196,481
---------------
MANUFACTURING-CAPITAL GOODS 0.9%
DANAHER CORP. 7,000 346,062
EATON CORP. 16,500 1,105,500
---------------
1,451,562
---------------
MANUFACTURING-CONSUMER GOODS 0.5%
MINN. MINING & MANUFCTRNG 8,600 709,500
---------------
MANUFACTURING - MISCELLANEOUS 1.1%
EASTMAN KODAK CO. 13,500 803,250
KIMBERLY-CLARK CORP. 15,500 889,312
---------------
1,692,562
---------------
MEDICAL EQUIPMENT & SUPPLIES 1.1%
BAXTER INTERNATIONAL 15,400 1,082,813
CARDINAL HEALTH 8,100 599,400
---------------
1,682,213
---------------
MEDICAL LABS & TESTING SERV. 0.5%
GILEAD SCIENCES, INC. *10,100 718,363
---------------
METALS & MINING 0.9%
ALCOA, INC. 47,000 1,363,000
---------------
OFFICE PROPERTIES 0.4%
EQUITY OFFICE PROPERTIES 24,700 680,794
---------------
OFFICE/BUSINESS EQUIPMENT & SUPPLIES 1.1%
I B M 15,900 1,742,044
---------------
OIL & GAS EQUIPMENT/SERVICES 2.4%
ENRON CORP. 33,300 2,147,850
ILLINOIS TOOL WORKS, INC. 28,100 1,601,700
---------------
3,749,550
---------------
ACTIVA Mutual Funds Semiannual Report 13
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
VALUE FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
OIL & GAS EXPLOR PROD & SER 6.5%
CONOCO, INC. 65,400 1,606,388
EXXON MOBIL CORP. COM 82,900 6,507,650
ULTRAMAR DIAMOND SHAMROCK 86,100 2,136,356
---------------
10,250,394
---------------
OIL & GAS TRANSMISSION 1.0%
EL PASO ENERY CORP. 29,600 1,507,750
---------------
PAPER PRODUCTS 1.1%
BOWATER, INC 18,900 833,963
TEMPLE - INLAND, INC. 8,400 352,800
WEYERHAUESER 15,800 679,400
---------------
1,866,163
---------------
PETROLEUM-REFINING 0.5%
ASHLAND, INC. 24,200 848,513
---------------
PHARMACEUTICALS 3.5%
ABBOTT LABS 25,300 1,127,431
AMERICAN HOME PRODUCTS 22,400 1,316,000
MYLAN LABORATORIES 13,400 244,550
PHARMACIA CORP. 54,961 2,840,797
---------------
5,528,778
---------------
PRINTING & PUBLISHING 0.5%
GANNETT COMPANY, INC. 12,600 753,637
---------------
RAILROADS 0.2%
CANADIAN NATIONAL RAILWAY 12,900 376,519
---------------
RESTAURANTS 0.7%
MCDONALD'S CORP. 33,500 1,103,406
---------------
RETAIL STORES 2.6%
INTIMATE BRANDS, INC. 125,800 2,484,550
TARGET CORP. 29,100 1,687,800
---------------
4,172,350
---------------
RETAIL STORES - GROCERY 1.3%
SAFEWAY, INC. *44,600 2,012,575
---------------
REAL ESTATE INVESTMENT TRUST 0.6%
KIMCO REALTY CORP. 22,500 922,500
---------------
14 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
VALUE FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
TOBACCO 2.3%
PHILIP MORRIS COS., INC. 96,900 2,573,906
RJ REYNOLDS TOBACCO HLDGS 37,200 1,039,275
---------------
3,613,181
---------------
TELECOMMUNICATIONS 11.8%
A T & T CORP. 84,000 2,656,500
ASSOCIATES FIRST CAPITAL 97,900 2,184,394
BELL ATLANTIC 106,100 5,391,206
SBC COMMUNICATIONS, INC. 67,600 2,923,700
SPRINT 32,800 1,672,800
SPRINT CORP. PCS 13,400 797,300
US WEST INC. NEW 12,100 1,037,575
WORLDCOM, INC. 44,050 2,020,794
---------------
18,684,269
---------------
TELECOMMUNICATIONS-SRVS AND EQUIP 0.4%
ECHOSTAR COMMUNICATIONS 18,000 595,969
---------------
WASTE MANAGEMENT 0.2%
REPUBLIC SERVICES, INC. *18,100 289,600
---------------
TOTAL COMMON STOCK (Cost $161,854,000) 158,422,469
---------------
TOTAL INVESTMENTS - 100% (Cost $161,903,318) 158,471,844
===============
</TABLE>
*Non-dividend producing as of June 30, 2000
At June 30, 2000, the Fund's open future contracts were as follows:
Number of Opening Face Market
Contracts Contract Type Amount Value
------------ -------------------------------- ---------- ----------
2 Standard & Poor's 500, 9/14/00 $735,520 $734,050
ACTIVA Mutual Funds Semiannual Report 15
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments
GROWTH FUND 6/30/00 (Unaudited)
<TABLE>
<CAPTION>
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C>
COMMERCIAL PAPER - 2.0% 2.0%
AMER. EXP. 6.88% 07/03/00 100,000 100,000
AMER. EXP. 6.78% 07/06/00 439,000 439,000
FORD MOTOR 6.81% 07/05/00 213,000 213,000
---------------
TOTAL COMMERCIAL PAPER (Cost $752,000) 752,000
---------------
COMMON STOCKS - 98.0%
AIRCRAFT ENGINES & ENGINE PARTS 0.2%
HONEYWELL INTERNATIONAL 1,700 57,269
---------------
AUTOMOTIVE 2.0%
GENERAL MOTORS - CLASS H *8,500 745,875
---------------
BANKING 4.5%
CHASE MANHATTAN CORP. 10,600 488,262
CITIGROUP, INC. 19,700 1,186,925
---------------
1,675,187
---------------
BEVERAGES - DOMESTIC 1.5%
COCA-COLA CO. 9,700 557,144
---------------
BREWERY 2.0%
ANHEUSER-BUSCH 9,900 739,406
---------------
BUSINESS SERVICES 1.2%
FIRST DATA CORP. 8,900 441,662
---------------
COMMUNICATIONS EQUIPMENT 1.3%
AMERICAN TOWER CORP. *11,700 487,744
---------------
COMPUTER SOFTWARE 4.9%
MICROSOFT *16,500 1,320,000
ORACLE CORP. 6,200 521,188
---------------
1,841,188
---------------
COMPUTERS 11.1%
CISCO SYSTEMS 21,700 1,373,881
COMVERSE TECHNOLOGY, INC. 6,100 567,300
DELL COMPUTER CORP. *15,000 739,688
INTEL CORPORATION 10,800 1,443,825
---------------
4,124,694
---------------
CONSUMER GOODS & SERVICES 1.4%
COLGATE-PALMOLIVE CO. 8,800 526,900
---------------
ELECTRICAL EQUIPMENT 4.6%
GENERAL ELECTRIC CO. 32,100 1,701,300
---------------
16 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
GROWTH FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
ELECTRONICS 6.5%
EMC CORP/MASS 10,600 815,538
SOLECTRON CORP. 22,600 946,375
TEXAS INSTRUMENTS, INC. 9,800 673,137
---------------
2,435,050
---------------
ENTERTAINMENT 5.1%
DISNEY WALT COMPANY 12,700 492,919
USA NETWORKS, INC. 15,900 343,838
VIACOM INC - CLASS B 15,624 1,065,361
---------------
1,902,118
---------------
FINANCIAL SERVICES 1.2%
MORGAN ST DEAN WITTER 5,400 449,550
---------------
INDUSTRIAL GOODS & SERVICES 1.2%
CORNING, INC. 1,700 458,787
---------------
INSTRUMENTATION 1.1%
PE CORP. - BIOSYSTEMS 6,200 408,425
---------------
INSURANCE 7.8%
AMER INT'L. GROUP 7,500 881,250
MARSH MCLENNAN COS COM 7,000 731,063
ST. PAUL CO. 16,700 569,887
ACE LIMITED 25,700 719,600
---------------
2,901,800
---------------
LEISURE & TOURISM 1.0%
HARLEY-DAVIDSON, INC. 9,200 354,200
---------------
MANUFACTURING-CAPITAL GOODS 0.8%
DANAHER CORP. 6,200 306,512
---------------
MEDICAL EQUIPMENT & SUPPLIES 7.3%
BAXTER INTERNATIONAL 12,400 871,875
GUIDANT CORP COMMON STOCK *10,300 509,850
TYCO INTERNATIONAL 28,400 1,345,450
---------------
2,727,175
---------------
MERCHANDISING 1.7%
OMNICOM GROUP COM 6,900 614,531
---------------
ACTIVA Mutual Funds Semiannual Report 17
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
GROWTH FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
OIL & GAS EXPLOR PROD & SER 9.0%
ANADARKO PETROLEUM 8,900 438,881
CONOCO, INC. 23,700 582,131
EXXON MOBIL CORP. COM 7,200 565,200
NOBLE DRILLING CORP. *12,000 494,250
TOTAL FINA SA - SPON ADR 9,400 723,800
TRANSOCEAN SEDCO FOREX 10,500 561,094
---------------
3,365,356
---------------
PHARMACEUTICALS 7.6%
PFIZER, INC. 36,375 1,746,000
PHARMACIA CORP. 20,600 1,064,763
---------------
2,810,763
---------------
RETAIL STORES 4.3%
BEST BUY COMPANY, INC. *2,800 177,100
CVS CORP. 12,100 484,000
STAPLES, INC. *22,400 344,400
WAL-MART STORES, INC. 10,600 610,825
---------------
1,616,325
---------------
TELECOMMUNICATIONS 4.7%
NOKIA CORP ADR 12,200 609,237
VOICESTREAM WIRELESS CORP. *4,000 465,188
WORLDCOM, INC. 14,850 681,244
---------------
1,755,669
---------------
TELECOMMUNICATIONS-SRVS AND EQUIP 4.0%
LUCENT TECHNOLGIES 6,100 361,425
NORTEL NETWORKS CORP. 16,300 1,112,475
---------------
1,473,900
---------------
TOTAL COMMON STOCKS (Cost $32,124,592) 36,478,530
---------------
TOTAL INVESTMENTS - 100% (Cost $32,876,592) 37,230,530
===============
</TABLE>
*Non-dividend producing as of June 30, 2000
18 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments
INTERNATIONAL FUND 6/30/00 (Unaudited)
<TABLE>
<CAPTION>
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
<S> <C> <C> <C>
COMMON STOCKS - 100.0%
AEROSPACE 3.2%
BPS BRITISH AEROSPACE PLC 50,939 317,528
BPS ROLLS-ROYCE PLC 72,000 257,515
CAD BOMBARDIER INC `B' 8,500 230,618
EUR FINMECCANICA SPA *262,600 362,485
---------------
1,168,146
---------------
AIRLINES 1.9%
BPS BRITISH AIRWAYS 50,300 289,558
EUR DEUTSCHE LUFTHANSA 7,900 185,535
YEN JAPAN AIRLINES LTD. 60,000 228,541
---------------
703,634
---------------
AUTOMOTIVE 0.6%
YEN TOYOTA MOTOR 5,000 228,258
---------------
BANKING 0.8%
UK ROYAL BANK OF SCOTLAND 18,200 303,634
---------------
BANKING & FINANCIAL SERVICES 3.0%
SEK SVENSKA AB COMMON 20,800 303,555
DEM DRESDNER BANK AG 8,100 336,983
SFR UBS AG-REGISTERED 3,000 440,942
---------------
1,081,480
---------------
BREWERY 0.9%
HEINEKEN NV 5,500 336,106
---------------
BIOTECHNOLOGY 0.5%
EUR QIAGEN N.V. *1,000 177,339
---------------
BROADCASTING 3.1%
NLG VNU N.V. 3,100 160,765
DEM EM.TV & MERCH AG 5,800 343,041
FFR TV FRANCAISE 9,000 629,794
---------------
1,133,600
---------------
BUSINESS SERVICES 0.9%
FFR VIVENDI 3,800 336,762
---------------
COMMUNICATIONS EQUIPMENT 3.7%
BPS ENERGIS PLC *3,200 119,368
SEK NETCOM AB *3,400 252,363
FNM HELSINGIN PUHELIN 4,700 462,251
AMDOCS LTD ORD *6,500 498,875
---------------
1,332,857
---------------
ACTIVA Mutual Funds Semiannual Report 19
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
COMMERCIAL SERVICES 1.3%
FFR BOUYGUES 426 285,852
RANDSTAD HOLDING NV COMM 4,500 167,154
---------------
453,006
---------------
COMPUTER SOFTWARE 1.7%
DEM INTERSHOP COMMS. *800 362,731
YEN TREND MICRO, INC. *1,500 248,106
---------------
610,837
---------------
COMPUTERS 4.4%
BPS LOGICA PLC SHRS 12,800 306,559
YEN FUJITSU LTD. 13,000 450,939
ASM LITHOGRAPHY ADR 19,000 838,375
---------------
1,595,873
---------------
DRUGS 2.1%
EUR AVENTIS 5,200 381,078
QLT PHOTOTHERAPEUTICS, INC. 4,800 371,100
---------------
752,178
---------------
DIVERSIFIED 3.1%
BPS BILLITON PLC 62,800 253,845
BPS INVENSYS PLC 81,400 305,306
FFR LAGARDERE S.C.A 4,700 360,430
HKD HUTCHISON WHAMPOA 14,300 179,781
---------------
1,099,362
---------------
ELECTRIC UTILITY 0.8%
ESP ENDESA S.A. 14,700 285,912
---------------
ELECTRICAL & ELECTRONIC 3.1%
BPS MARCONIN PLC 37,000 480,883
YEN PIONEER CORP. 12,000 468,425
LERNOUT HAUSPIE SPEECH NV 4,000 176,250
---------------
1,125,558
---------------
ELECTRICAL EQUIPMENT 2.1%
SAMSUNG ELECTRONICS-GDR 1,000 193,000
YEN MITSUBISHI ELEC 42,000 455,721
SONY CORP ADR 1,200 113,175
---------------
761,896
---------------
20 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- --------------
ELECTRONICS 8.3%
BPS ARM HOLDINGS 41,000 437,283
ROYAL PHILIPS ELECTRONICS 12,800 608,000
DEM EPCOS AG 2,900 293,003
YEN FANUC, LTD. 4,200 428,330
YEN KYOCERA CORPORATION 800 136,028
YEN SONY CORP. 1,600 149,714
YEN TOSHIBA CORPORATION 43,000 486,486
STMICROELECTRONICS NV-NY 7,200 462,150
---------------
3,000,994
---------------
ENERGY 2.0%
BALLARD POWER SYSTEMS *2,800 251,475
BPS SHELL TRNSPORT/TRADNG 54,500 458,742
---------------
710,217
---------------
ENTERTAINMENT 0.8%
BPS PEARSON PLC 8,600 270,156
---------------
FINANCIAL SERVICES 2.4%
SEK NORDIC BALTIC HLDG 37,700 285,843
BEL FORTIS (B) 6,800 198,681
YEN NOMURA SECURITIES 8,000 196,216
YEN PROMISE CO LTD. 2,200 174,251
---------------
854,991
---------------
FOOD PRODUCTS 0.6%
SFR NESTLE 100 200,791
---------------
FOOD SERVICE 0.8%
BPS SAINSBURY (J) PLC 36,300 164,314
EUR KONONKLIJKE AHOLD 4,200 124,124
---------------
288,438
---------------
FOOD PROCESSING 0.7%
FFR DANONE 2,000 266,488
---------------
GAS & ELECTRIC UTILITY 2.0%
BPS CENTRICA PLC 128,200 425,040
BPS BG GROUP 44,700 288,280
---------------
713,320
---------------
HEALTH CARE 0.4%
FFR RHODIA 8,300 140,031
---------------
HOTELS & LODGING 0.7%
FFR ACCOR SA 5,800 238,683
---------------
ACTIVA Mutual Funds Semiannual Report 21
The accompanying notes are an integral part of these financial statements.
<PAGE>
Activa Schedule of Investments continued
INTERNATIONAL FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
INFORMATIONAL SERVICES 0.9%
REUTERS GROUP PLC ADR 3,100 309,806
---------------
INSURANCE 3.0%
ITL ALLEANZA ASSICURZIONI 23,700 316,924
FFR AXA 2,100 332,151
SEK SKANDIA FORSAKRINGS 16,800 446,303
---------------
1,095,378
---------------
MACHINERY & EQUIPMENT 0.6%
FFR ALSTOM COMMON 7,800 211,674
---------------
MANUFACTURING-CAPITAL GOODS 1.4%
CAD MAGNA INTL. - CL A 4,000 187,761
YEN TOYODA GOSEI CO LTD. 5,000 318,048
---------------
505,809
---------------
MANUFACTURING-CONSUMER GOODS 1.5%
YEN DAIKIN IND LTD. 10,000 232,983
YEN NIPPON SHEET GLASS 21,000 292,567
---------------
525,550
---------------
MANUFACTURING-MISCELLANEOUS 2.5%
DEM SIEMENS AG NPV (REGD) 1,500 226,467
EUR INFINEON TECH *4,700 373,946
FLEXTRONICS 4,100 281,619
---------------
882,032
---------------
MEDICAL EQUIPMENT & SUPPLIES 0.9%
BIOVAIL CORP. 5,600 310,450
---------------
OIL & GAS EQUIPMENT/SERVICES 1.4%
SCHLUMBERGER LTD. 4,200 313,425
SANTA FE INTERNATIONAL 5,900 206,131
---------------
519,556
---------------
OIL & GAS EXPLOR PROD & SER 4.3%
CAD ANDERSON EXPLORATION *15,000 272,328
ITL ENTE NAZ IDROC 33,800 196,022
FFR TOTAL S.A. `B' 3,048 469,238
HKD PETROCHINA CO LTD. *950,000 197,434
LUKOIL HOLDING ADR 2,900 148,248
PRECISION DRILLING CORP. *7,000 270,375
---------------
1,553,645
---------------
PAPER PRODUCTS 0.5%
ABITIBI-CONSOLIDATED, INC. 18,800 176,250
---------------
22 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND 6/30/00 (Unaudited)
% OF SHARES OR MARKET
SECURITY DESCRIPTION INVESTMENTS PAR VALUE VALUE
----------------- ------------ ----------- ---------------
PETROLEUM-RETAIL 0.8%
PETROLEO BRASILEIRO ADR 9,600 290,030
---------------
PHARMACEUTICALS 1.6%
TEVA PHARMACEUTICAL-ADR 10,100 559,919
---------------
PRINTING & PUBLISHING 0.8%
NEWS CORP LTD ADR 5,500 299,750
---------------
REAL ESTATE 0.6%
YEN MITSUI FUDOSAN 21,000 228,258
---------------
TOBACCO 1.3%
ESP ALTADIS SA - A SHARES 30,800 475,050
---------------
TRANSPORTATION & SHIPPING 0.7%
YEN YAMATO TRANSPORT CO. 10,000 249,051
---------------
TELECOMMUNICATIONS 14.7%
BPS CABLE & WIRELESS 17,400 294,766
BPS COLT TELECOM GROUP *7,000 232,611
BPS VODAFONE 94,972 385,326
FNM SONERA GROUP PLC 7,000 320,409
DAK TELE DANMANK `B' 5,000 337,953
ESP TELEFONICA DE ESPANA *18,000 388,229
FFR ALCATEL ALSTHOM 9,300 612,453
SEK TELIA AB *27,000 255,509
YEN NTT MOBILE COMM 19 515,399
HKD PACIFIC CENTURY *96,000 189,659
NOKIA CORP ADR 13,200 659,175
YEN NEC CORP. 10,000 314,740
YEN NIPPON TELEGRAPH TELE 29 386,478
TELE NORTE LESTE ADR 8,601 203,199
USD TELEBRAS ADR PFD BLCK 1,900 184,537
---------------
5,280,443
---------------
TELECOMMUNICATIONS-SRVS AND EQUIP 5.7%
ERICSSON TEL-SP ADR 38,400 768,000
SEK EUROPOLITAN HOLDINGS 12,500 156,059
NLG KONINKLIJKE KPN NV 8,200 368,261
NORTEL NETWORKS CORP. 11,000 750,750
---------------
2,043,070
---------------
WHOLESALE DISTRIBUTION 0.9%
YEN SOFTBANK CORP. 2,300 313,039
---------------
TOTAL COMMON STOCKS - 100% (Costs $31,535,737) 35,999,307
===============
</TABLE>
*Non-dividend producing as of June 30, 2000
ACTIVA Mutual Funds Semiannual Report 23
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Statement of Assets and Liabilities
<TABLE>
<CAPTION>
MONEY MARKET INTERMEDIATE INTERNATIONAL
As of June 30, 2000 (Unaudited) FUND BOND FUND VALUE FUND GROWTH FUND FUND
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments at value $104,893,888 $163,196,199 $158,471,844 $37,230,530 $35,999,307
Cash 987 3,658,686 2,438,654 81,990 1,396,147
Receivables:
Investments sold -- -- 4,956,393 60,649 468,656
Investment income 1,042,136 1,405,117 257,333 23,542 39,039
Variation Margin -- -- 5,050 -- --
Other assets 22,284 17,822 125,927 13,179 32,656
Foreign currency holdings -- -- -- -- 11,766
------------- ------------- ------------- ------------- -------------
Total Assets 105,959,295 168,277,824 166,255,201 37,409,890 37,947,571
------------- ------------- ------------- ------------- -------------
LIABILITIES
Payables:
Investments purchased -- -- 3,492,304 120,273 334,988
Income payable 513,524 -- -- -- --
Advisory fees 91,264 138,602 211,681 63,036 79,075
Transfer agent fees 362 91 56,646 960 591
12b-1 fees -- 61,763 63,153 13,830 13,955
Service fees 39,114 61,763 63,505 13,830 13,955
Accrued expenses 8,432 9,595 22,263 5,663 7,308
------------- ------------- ------------- ------------- -------------
Total Liabilities 652,696 271,814 3,909,552 217,592 449,872
------------- ------------- ------------- ------------- -------------
NET ASSETS $105,306,599 $168,006,010 $162,345,649 $37,192,298 $37,497,699
============= ============= ============= ============= =============
SHARES OUTSTANDING 105,308,069 17,041,314 25,004,691 3,260,157 3,021,753
============= ============= ============= ============= =============
NET ASSET VALUE PER SHARE $1.00 $9.86 $11.41 $12.41
Class A based on net assets of
$161,390,050 and 24,857,382
shares outstanding $6.49
Class R based on net assets of
$955,599 and 147,309
shares outstanding $6.49
</TABLE>
24 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Statement of Operations
For the period ended June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
MONEY MARKET INTERMEDIATE INTERNATIONAL
FUND BOND FUND VALUE FUND GROWTH FUND FUND
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Interest $3,353,384 $5,653,339 $209,271 $39,506 $37,124
Dividends -- -- 1,580,218 115,025 200,412
Miscellaneous 593 1,216 182,098 159 19,923
------------- ------------- ------------- ------------- -------------
Total Investment Income 3,353,977 5,654,555 1,971,587 154,690 257,459
------------- ------------- ------------- ------------- -------------
EXPENSES
Advisory fees 190,071 276,903 413,377 121,786 167,620
12b-1 fees -- 122,403 123,399 26,670 29,580
Service fees 81,460 122,403 124,014 26,670 29,580
Shareholder report 2,550 2,550 19,100 2,550 2,550
Fund accounting fees 25,874 29,110 31,840 19,212 20,560
Audit fees 5,528 5,528 5,528 5,528 5,528
Custodian fees 10,770 10,010 21,840 6,650 8,992
Insurance 899 1,172 1,284 242 313
Legal fees 4,832 4,832 5,732 4,832 4,832
Organization expense -- -- 15,448 -- --
Registration fees 7,270 1,990 11,008 910 910
Transfer agent fees 710 172 116,506 1,624 1,001
Transfer agent fees - Class R -- -- 821 -- --
------------- ------------- ------------- ------------- -------------
Total Expenses 329,964 577,073 889,897 216,674 271,466
------------- ------------- ------------- ------------- -------------
Net Investment Income (Loss) 3,024,013 5,077,482 1,081,690 (61,984) (14,007)
------------- ------------- ------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on
security transactions -- (559,605) (1,008,913) 448,500 2,938,991
Net realized gain (loss) on
foreign currency transactions -- -- -- -- (128,211)
Net realized gain (loss) on
futures contracts -- -- -- -- --
Changes in net unrealized
appreciation or depreciation
of investments
and foreign currency -- 52,193 (4,240,899) (258,440) (8,223,705)
------------- ------------- ------------- ------------- ------------
Net Gain (Loss) on Investments -- (507,412) (5,249,812) 190,060 (5,412,925)
------------- ------------- ------------- ------------- ------------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS $3,024,013 $4,570,070 ($4,168,122) $128,076 ($5,426,932)
============= ============= ============= ============ =============
</TABLE>
ACTIVA Mutual Funds Semiannual Report 25
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Statement of Changes in Net Assets
<TABLE>
<CAPTION>
MONEY MARKET FUND INTERMEDIATE BOND FUND
PERIOD ENDED PERIOD ENDED PERIOD ENDED PERIOD ENDED
6/30/00 12/31/99** 6/30/00 12/31/99*
(UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
NET ASSETS FROM OPERATIONS
Net investment income $3,024,013 $2,205,567 $5,077,482 $3,129,045
Net realized gain (loss) on investments -- (1,470) (559,605) (520,543)
Net increase (decrease) in unrealized
appreciation -- -- 52,193 (1,565,246)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations 3,024,013 2,204,097 4,570,070 1,043,256
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income:
Class A (3,024,013) (2,205,567) (4,751,527) (3,135,031)
Class R -- -- -- --
Net realized gain from investment transactions:
Class A -- -- -- --
Class R -- -- -- --
------------ ------------ ------------ ------------
Total distributions to shareholders (3,024,013) (2,205,567) (4,751,527) (3,135,031)
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of shares:
Class A 7,332,714 385,892,878 1,360,037 161,036,335
Class R -- -- -- --
Net asset value of shares issued to shareholders
in reinvestment of investment income and
realized gain from security transactions:
Class A 3,076,620 1,640,409 4,751,049 3,135,026
Class R -- -- -- --
Payment for shares redeemed:
Class A (27,161,452) (265,473,100) (2,205) (1,000)
Class R -- -- -- --
------------ ------------ ------------ ------------
Net increase (decrease) in net assets derived
from capital share transactions (16,752,118) 122,060,187 6,108,881 164,170,361
------------ ------------ ------------ ------------
Net Increase (Decrease) in Net Assets (16,752,118) 122,058,717 5,927,424 162,078,586
Net Assets, beginning of year or period 122,058,717 -- 162,078,586 --
------------ ------------ ------------ ------------
Net Assets, end of year or period $105,306,599 $122,058,717 $168,006,010 $162,078,586
============ ============ ============ ============
NET ASSETS CONSIST OF:
Capital $105,308,069 $122,060,187 $170,279,243 $164,170,361
Undistributed net investment
income (loss) -- -- 319,968 --
Return of capital -- -- -- (5,986)
Undistributed net realized gain
(loss) from investments (1,470) (1,470) (1,080,148) (520,543)
Unrealized appreciation (depreciation) of
investments and foreign currency -- -- (1,513,053) (1,565,246)
------------ ------------ ------------ ------------
$105,306,599 $122,058,717 $168,006,010 $162,078,586
============ ============ ============ ============
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 7,332,714 385,892,878 138,637 16,103,631
Class R -- -- --
Reinvested distributions:
Class A 3,076,620 1,640,409 484,486 314,884
Class R -- -- -- --
Shares redeemed:
Class A (27,161,452) (265,473,100) (224) (100)
Class R -- -- -- --
------------ ------------ ------------ ------------
Net increase (decrease) in fund shares (16,752,118) 122,060,187 622,899 16,418,415
Shares outstanding, beginning of
year or period 122,060,187 -- 16,418,415 --
------------ ------------ ------------ ------------
Shares outstanding, end of year or period 105,308,069 122,060,187 17,041,314 16,418,415
============ ============ ============ ============
* Period from August 30, 1999 (inception) to December 31, 1999
** Period from August 19, 1999 (inception) to December 31, 1999
26 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
<PAGE>
VALUE FUND GROWTH FUND
PERIOD ENDED YEAR ENDED PERIOD ENDED PERIOD ENDED
6/30/00 12/31/99 6/30/00 12/31/99*
(UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
------------ ------------ ----------- -----------
NET ASSETS FROM OPERATIONS
Net investment income $1,081,690 $2,327,973 ($61,984) ($50,988)
Net realized gain (loss) on investments (1,008,913) (16,305,655) 448,500 (507,647)
Net increase (decrease) in unrealized
appreciation (4,240,899) (1,651,637) (258,440) 4,612,378
------------ ------------ ----------- -----------
Net increase (decrease) in net assets
resulting from operations (4,168,122) (15,629,319) 128,076 4,053,743
DISTRIBUTIONS TO SHAREHOLDERS Net investment income:
Class A -- (2,385,633) -- --
Class R -- (9,561) -- --
Net realized gain from investment transactions:
Class A -- -- -- --
Class R -- -- -- --
------------ ------------ ----------- -----------
Total distributions to shareholders -- (2,395,194) -- --
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of shares:
Class A 19,344,698 43,711,117 3,763,969 29,440,970
Class R 340,950 761,794 -- --
Net asset value of shares issued to shareholders
in reinvestment of investment income and
realized gain from security transactions:
Class A -- 2,333,242 -- --
Class R -- 9,566 -- --
Payment for shares redeemed:
Class A (32,242,174) (29,493,812) (194,160) (300)
Class R (71,142) (111,360) -- --
------------ ------------ ----------- -----------
Net increase (decrease) in net assets derived
from capital share transactions (12,627,668) 17,210,547 3,569,809 29,440,670
------------ ------------ ----------- -----------
Net Increase (Decrease) in Net Assets (16,795,790) (813,966) 3,697,885 33,494,413
Net Assets, beginning of year or period 179,141,439 179,955,405 33,494,413 --
------------ ------------ ----------- -----------
Net Assets, end of year or period $162,345,649 $179,141,439 $37,192,298 $33,494,413
============ ============ =========== ===========
NET ASSETS CONSIST OF:
Capital $182,650,398 $195,278,066 $33,010,478 $29,440,670
Undistributed net investment
income (loss) 1,021,020 -- (112,971) (50,988)
Return of capital -- (60,670) -- --
Undistributed net realized gain
(loss) from investments (17,892,785) (16,883,872) (59,147) (507,647)
Unrealized appreciation (depreciation) of
investments and foreign currency (3,432,984) 807,915 4,353,938 4,612,378
------------ ------------ ----------- -----------
$162,345,649 $179,141,439 $37,192,298 $33,494,413
============ ============ =========== ===========
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 2,905,859 5,644,826 335,442 2,941,753
Class R 51,433 101,720 -- --
Reinvested distributions:
Class A -- 352,454 -- --
Class R -- 1,449 -- --
Shares redeemed:
Class A (5,027,429) (4,054,442) (17,010) (28)
Class R (10,854) (15,356) -- --
------------ ------------ ----------- -----------
Net increase (decrease) in fund shares (2,080,991) 2,030,651 318,432 2,941,725
Shares outstanding, beginning of
year or period 27,085,682 25,055,031 2,941,725 --
------------ ------------ ----------- -----------
Shares outstanding, end of year or period 25,004,691 27,085,682 3,260,157 2,941,725
============ ============ =========== ===========
INTERNATIONAL FUND
PERIOD ENDED PERIOD ENDED
6/30/00 12/31/99*
(UNAUDITED) (AUDITED)
----------- -----------
NET ASSETS FROM OPERATIONS
Net investment income ($14,007) ($98,962)
Net realized gain (loss) on investments 2,810,780 (374,090)
Net increase (decrease) in unrealized
appreciation (8,223,705) 12,686,197
----------- -----------
Net increase (decrease) in net assets
resulting from operations (5,426,932) 12,213,145
DISTRIBUTIONS TO SHAREHOLDERS Net investment income:
Class A -- --
Class R -- --
Net realized gain from investment transactions:
Class A -- --
Class R -- --
----------- -----------
Total distributions to shareholders -- --
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of shares:
Class A 1,686,905 29,159,031
Class R -- --
Net asset value of shares issued to shareholders
in reinvestment of investment income and
realized gain from security transactions:
Class A -- --
Class R -- --
Payment for shares redeemed:
Class A (121,450) (13,000)
Class R -- --
----------- -----------
Net increase (decrease) in net assets derived
from capital share transactions 1,565,455 29,146,031
----------- -----------
Net Increase (Decrease) in Net Assets (3,861,477) 41,359,176
Net Assets, beginning of year or period 41,359,176 --
----------- -----------
Net Assets, end of year or period $37,497,699 $41,359,176
=========== ===========
NET ASSETS CONSIST OF:
Capital $30,711,484 $29,146,031
Undistributed net investment
income (loss) (193,147) (98,962)
Return of capital -- --
Undistributed net realized gain
(loss) from investments 2,516,869 (374,090)
Unrealized appreciation (depreciation) of
investments and foreign currency 4,462,493 12,686,197
----------- -----------
$37,497,699 $41,359,176
=========== ===========
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 119,158 2,912,903
Class R -- --
Reinvested distributions:
Class A -- --
Class R -- --
Shares redeemed:
Class A (9,339) (969)
Class R -- --
----------- -----------
Net increase (decrease) in fund shares 109,819 2,911,934
Shares outstanding, beginning of
year or period 2,911,934 --
----------- -----------
Shares outstanding, end of year or period 3,021,753 2,911,934
=========== ===========
</TABLE>
* Period from August 30, 1999 (inception) to December 31, 1999
** Period from August 19, 1999 (inception) to December 31, 1999
ACTIVA Mutual Funds Semiannual Report 27
The accompanying notes are an integral part of these financial statements.
<PAGE>
ACTIVA Notes to Financial Statements
1. ORGANIZATION
Activa Mutual Fund Trust (Trust) was organized as a Delaware business trust on
February 2, 1998. The trust consists of five funds, each open-end management
investment companies registered under the Investment Company Act of 1940. The
funds are: the Activa Money Market Fund (Money Market Fund), the Activa
Intermediate Bond Fund (Intermediate Bond Fund), the Activa Value Fund (Value
Fund), the Activa Growth Fund (Growth Fund) and the Activa International Fund
(International Fund) collectively referred to as the Funds. The Value Fund is
the successor to Amway Mutual Fund.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment Objectives
The Money Market Fund's investment objective is to seek a high level of current
income as is consistent with preservation of capital and liquidity. The Money
Market Fund invests in a broad spectrum of high quality U.S. dollar-denominated
money market securities, with the average weighted maturity of the securities
held not to exceed 90 days.
The Intermediate Bond Fund's investment objective is to seek a high level of
current income as is consistent with moderate risk of capital and maintenance of
liquidity. The Intermediate Bond Fund invests primarily in investment-grade debt
securities, with average maturity of three to ten years.
The Value Fund's investment objective is to maximize long-term capital
appreciation, and invests primarily in common stocks of large and medium size
U.S. companies which are considered by the investment manager to be undervalued.
The Growth Fund seeks long-term growth of capital, and invests primarily in
common stocks believed by the investment manager to have long-term growth
potential.
The International Fund seeks maximum long-term capital appreciation. The
International Fund invests primarily in common stocks of large and medium size
non-U.S. companies which are believed by the investment manager to have
potential for above-average growth of earnings.
Classes of Shares
The Value Fund offers two classes of shares (Class A and Class R). The Class R
shares are offered to tax-exempt retirement and benefit plans of Amway
Corporation and its affiliates, and are not subject to any sales charges or
12b-1 distribution fees. Each share of Class A and Class R represents an equal
proportionate interest in the Value Fund and, generally, will have identical
voting, dividend, liquidation, and other rights and the same terms and
conditions. Each class will have exclusive voting rights with respect to matters
affecting only that class. Each class bears different distribution, shareholder
servicing and transfer agent expenses. Income, non-class specific expenses, and
realized and unrealized gains or losses on investments are allocated to each
class of shares based upon its relative net assets.
Security Valuation
Investments in securities listed or admitted to trading on a national securities
exchange are valued at their last reported sale price before the time of
valuation. If a security is traded only in the over-the-counter market, or if no
sales have been reported for a listed security on that day, it is valued at the
mean between the current closing bid and ask prices. Short-term securities
maturing within 60 days are valued at amortized cost, which approximates fair
value. Portfolio debt securities with remaining maturities greater than 60 days
are valued by pricing agents approved by the Board of Trustees. Foreign
securities are converted to U.S. dollars using exchange rates at the close of
the New York Stock Exchange. Securities for which market quotations are not
readily available, including any restricted securities (none at June 30, 2000),
and other assets of the Funds are valued at fair market value as determined by
the Fund's Board of Trustees.
Derivative Transactions
The Funds (except the Money Market Fund) may trade in derivative contracts to
hedge portfolio holdings and for investment purposes. Hedging activities are
intended to reduce various risks associated with fluctuations in foreign
currency exchange rates. When entering into a forward currency contract, the
fund agrees to receive or deliver a fixed
28 ACTIVA Mutual Funds Semiannual Report
<PAGE>
ACTIVA Notes to Financial Statements continued
quantity of foreign currency for an agreed-upon price on an agreed future date.
These contracts are valued daily. The fund's net equity in the contracts is
included as unrealized gains or losses in the statement of assets and
liabilities. This unrealized gain or loss is the difference between the forward
foreign exchange rates at the dates of entry into the contracts and the forward
rates at the reporting date. The current year change in unrealized gains and
losses and realized gains and losses are included in the statement of
operations.
Security Transactions
Security transactions are accounted for on the trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Original issue discounts are accreted and premium is amortized on debt
securities to interest income over the life of a security with a corresponding
adjustment in the cost basis. Realized gains and losses from security
transactions and unrealized appreciation and depreciation of investments are
reported on a specific identification basis. Dividends and distributions to
shareholders are recorded by the Funds on the ex-dividend date.
Foreign Currency Translation
Investment securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at date of valuation.
Purchases and sales of investment securities and income and expense items
denominated in foreign currencies are translated into U.S. dollar amounts on the
respective dates of such transactions.
Net realized gains and losses from foreign currency and investment transactions
disclosed in the Statement of Operations consist of net gains and losses on
disposition of foreign currency, currency gains and losses realized between
trade and settlement dates on security transactions, and the difference between
the amount of net investment income accrued and the amount actually received in
U.S. dollars. Net unrealized foreign exchange gains and losses arise from
changes in fair values of assets and liabilities other than investments in
securities at period end, resulting from changes in exchange rates. The effects
of foreign currency exchange rates on foreign securities held are included in
net realized and unrealized gain or loss on investments.
Futures Contracts
The Funds may use futures contracts to manage its exposure to the stock and bond
markets. Buying futures tends to increase the fund's exposure to the underlying
instrument, while selling futures tends to decrease the fund's exposure to the
underlying instrument or hedge other fund investments. Futures contracts
involve, to varying degrees, risk of loss in excess of the futures variation
margin reflected in the Statement of Assets and Liabilities. The underlying face
amount at value of any open futures contracts at period end is shown at the end
of the schedule of investments. This amount reflects each contract's exposure to
the underlying instrument at period end. Losses may arise from changes in the
value of the underlying instruments or if the counterparties do not perform
under the contract's terms. Gains (losses) are realized upon the expiration or
closing of the futures contracts. Futures contracts are valued at the settlement
price established each day by the board of trade or exchange on which they are
traded.
Reorganization Costs
Reorganization costs incurred prior to June 30, 1998 in connection with the
reorganization of Amway Mutual Fund and the issuance of Class R shares are being
amortized over a period of 60 months using the straight-line method in the Value
Fund.
Federal Income Taxes
It is the Funds' policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to make distributions of
income and capital gains sufficient to relieve it from substantially all federal
income taxes.
Dividend Distributions
The Money Market Fund and Intermediate Bond Fund declare dividends daily and
monthly respectively, and distribute dividends monthly, and capital gains (if
any) are distributed annually. The Value Fund, Growth Fund and International
Fund declare and distribute dividends and capital gains (if any) annually.
ACTIVA Mutual Funds Semiannual Report 29
<PAGE>
ACTIVA Notes to Financial Statements continued
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets from operations during the reporting period. Actual results could differ
from those estimates.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
The funds have entered into investment advisory agreements with Activa Asset
Management LLC (the Adviser), effective June 11, 1999. The funds employ the
investment adviser to provide investment advice and manage on a regular basis
the investment portfolios for the funds. Except when otherwise specifically
directed by the Funds, the Investment Adviser will make investment decisions on
behalf of the Funds and place all orders for the purchase and sale of portfolio
securities for the Funds' accounts. The Adviser shall be permitted to enter into
an agreement with another advisory organization (sub-adviser), whereby the
sub-adviser will provide all or part of the investment advice and services
required to manage the Funds' investment portfolios as provided for in these
agreements. In return for these services, the Funds pay the adviser an annual
rate as follows:
FUND % OF AVERAGE NET ASSETS
Money Market .35% until assets total $500 million; when assets reach
$500 million, .35% on first $100 million; .325% on next
$100 million; .30% on assets in excess of $200 million
Intermediate Bond .40% on first $50 million; .32% on next $100 million;
.24% on assets in excess of $150 million
Value .50% on first $350 million; .45% on assets in excess of
$350 million; the minimum annual fee shall be $350,000
Growth .70% on first $25 million; .65% on next $25 million;
.60% on assets in excess of $50 million
International .85% on first $50 million; .75% on assets in excess
of $50 million
As permitted by the above agreements, the Adviser has retained the following
sub-advisers:
FUND SUB-ADVISER
Money Market JP Morgan Investment Management, Inc.
Intermediate Bond Van Kampen Management, Inc.
Value Wellington Management Company, LLP*
Growth State Street Research & Management Company
International Nicholas-Applegate Capital Management
*Wellington Management Company, LLP became sub-adviser for the Value Fund
effective December 30, 1999. Prior to that agreement, sub-advisory services were
provided by Ark Asset Management Co., Inc.
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Value Fund,
Intermediate Bond Fund, Growth Fund and International Fund have entered into a
Plan and Agreement of Distribution with Activa Asset Management LLC. Under the
terms of the agreement, Activa Asset Management LLC provides services in
connection with distributing the Funds' shares (except the Money Market Fund and
Value Fund Class R). For these services rendered, the Funds compensate Activa
Asset Management LLC monthly at a maximum annual rate of .25 of 1% of the
average net assets of the Fund. For the year or period ended June 30, 2000 the
Board of Trustees approved an annual rate of .15 of 1%.
The Funds have a transfer agency and dividend disbursing agency agreement with
Activa Asset Management LLC. Under these agreements, Activa Asset Management LLC
is the agent for transfer of the Funds' shares and disbursement of the Funds'
distributions. For these services, The Money Market, Intermediate Bond, Value
(Class A), Growth and International Funds pay a monthly fee based upon $1.167
per account in existence during the month. The transfer agent is compensated by
the Value Fund (Class R) at a monthly rate of 1/12 of .20% (.20% annually) of
average net assets.
30 ACTIVA Mutual Funds Semiannual Report
<PAGE>
ACTIVA Notes to Financial Statements continued
On June 11, 1999 the Trust entered into an administrative agreement with Activa
Asset Management LLC. Under the terms of the agreement Activa Asset Management
LLC will act as administrator for the Funds. As administrator of the Funds,
Activa Asset Management LLC will furnish office space and office facilities,
equipment and personnel, pay the fees of all Trustees of the Trust, as well as
providing services relating to compliance, tax and financial service
requirements. For these services, the administrator will be compensated
quarterly by each fund at an annual rate of .15% of average daily net assets.
On July 9, 1999 the Trust entered into a Fund Accounting Agreement with Bisys
Fund Services Ohio, Inc. (Fund Accountant). As stated in the agreement, the Fund
Accountant is responsible for the maintenance of books and records, performance
of daily accounting services, providing the Funds' management with monthly
financial statements and certain information necessary for meeting compliance
requirements. The Fund Accountant is compensated by each fund based upon an
annual fee of $35,000 for assets up to $100 million; $50,000 for assets between
$100 million and $1 billion; and $75,000 for assets in excess of $1 billion. In
addition, each fund will pay the Fund Accountant an annual fee of $2,500 for
portfolio accounting reports provided to investment adviser personnel through
internet access.
Prior to June 11, 1999 the Value Fund had substantially the same agreements for
all of the above services provided by Amway Management Company, the former
Adviser, Transfer Agent, Distributor and Underwriter.
4. INVESTMENT TRANSACTIONS
At June 30, 2000, the cost of investments owned by the Value Fund was
$162,813,861 for federal income tax purposes. Aggregate gross unrealized
appreciation on securities in which there was an excess of market value over tax
cost was $10,093,248. Aggregate gross unrealized depreciation on securities in
which there was an excess of tax cost over market value was $13,701,254. Net
unrealized depreciation for tax purposes was $3,608,006, at June 30, 2000.
The unrealized appreciation (depreciation) at June 30, 2000 based upon cost of
both long-term and short-term securities for the funds that have elected an
October 31st year-end for federal income tax purposes were as follows:
Net Cost for
Gross Gross unrealized federal
unrealized unrealized appreciation income tax
Fund appreciation depreciation (depreciation) purposes
---- ------------ ------------ ------------- ----------
Money Market N/A N/A N/A 104,773,932
Intermediate
Bond 390,977 1,904,030 (1,513,053) 164,558,273
Growth 5,514,664 1,171,533 4,343,131 32,887,399
International 5,898,172 1,438,709 4,459,463 31,539,844
5. RELATED PARTY TRANSACTION
A certain class of Independent Business Owners of Amway Corporation and Amway
Canada, Ltd. (Corporations) received from each corporation part of its Emerald
profit-sharing bonus in common stock shares of the Value Fund. On January 13,
2000, the Corporations purchased 336,807 Value Fund shares valued at $2,222,925
(based upon the net asset value of $6.60 per share) and transferred the shares
to these Independent Business Owners.
ACTIVA Mutual Funds Semiannual Report 31
<PAGE>
<TABLE>
Activa Financial Highlights
<CAPTION>
MONEY MARKET FUND INTERMEDIATE BOND FUND
PERIOD PERIOD PERIOD PERIOD
ENDED ENDED ENDED ENDED
6/30/00 12/31/99** 6/30/00 12/31/99*
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period 1.00 1.00 9.87 10.00
Income from investment operations:
Net investment income (loss) 0.03 0.02 0.30 0.19
Net realized and unrealized gains (losses)
on securities -- -- (0.03) (0.13)
---------- ---------- ---------- ----------
Total from investment operations 0.03 0.02 0.27 0.06
Less Distributions:
Dividends from net investment income 0.03 0.02 0.28 0.19
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- --
---------- ---------- ---------- ----------
Total Distributions 0.03 0.02 0.28 0.19
---------- ---------- ---------- ----------
Net Asset Value, End of Period 1.00 1.00 9.86 9.87
Total Return **** 2.81% 1.83% 2.83% 0.63%
RATIOS AND SUPPLEMENTAL DATA
Net assets, End of Period 105,306,599 122,058,717 168,006,010 162,078,586
Ratio of expenses to average net assets***** 0.3% 0.6% 0.4% 0.7%
Ratio of net income (loss) to average net assets 2.8% 5.4% 3.1% 5.7%
Portfolio turnover rate N/A N/A 16.9% 64.6%
Average commission rate paid per share for
portfolio transactions N/A N/A N/A N/A
32 ACTIVA Mutual Funds Semiannual Report
<CAPTION>
Activa Financial Highlights
VALUE FUND - CLASS A VALUE FUND - CLASS R
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/00 12/31/99*** 6/30/00 12/31/99***
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period 6.61 7.18 6.60 7.16
Income from investment operations:
Net investment income (loss) 0.04 0.09 0.04 0.10
Net realized and unrealized gains (losses)
on securities (0.16) (0.57) (0.15) (0.56)
---------- ---------- ---------- -------
Total from investment operations (0.12) (0.48) (0.11) (0.46)
Less Distributions:
Dividends from net investment income -- 0.09 -- 0.10
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- --
---------- ---------- ---------- -------
Total Distributions -- 0.09 -- 0.10
---------- ---------- ---------- -------
Net Asset Value, End of Period 6.49 6.61 6.49 6.60
Total Return **** -1.82% -6.70% -1.67% -6.43%
RATIOS AND SUPPLEMENTAL DATA
Net assets, End of Period 161,390,050 178,437,477 955,599 703,962
Ratio of expenses to average net assets***** 0.5% 1.1% 0.5% 1.1%
Ratio of net income (loss) to average net assets 0.6% 1.2% 0.7% 1.3%
Portfolio turnover rate 63.9% 144.5% 63.9% 144.5%
Average commission rate paid per share for
portfolio transactions 0.0378 0.0481 0.0378 0.0481
<CAPTION>
Activa Financial Highlights
GROWTH FUND INTERNATIONAL FUND
PERIOD PERIOD PERIOD PERIOD
ENDED ENDED ENDED ENDED
6/30/00 12/31/99* 6/30/00 12/31/99*
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period 11.39 10.00 14.20 10.00
Income from investment operations:
Net investment income (loss) (0.02) (0.02) (0.01) (0.03)
Net realized and unrealized gains (losses)
on securities 0.04 1.41 (1.78) 4.23
------- ---------- ---------- ----------
Total from investment operations 0.02 1.39 (1.79) 4.20
Less Distributions:
Dividends from net investment income -- -- -- --
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- --
------- ---------- ---------- ----------
Total Distributions -- -- -- --
------- ---------- ---------- ----------
Net Asset Value, End of Period 11.41 11.39 12.41 14.20
Total Return **** 0.18% 13.80% -12.61% 42.00%
RATIOS AND SUPPLEMENTAL DATA
Net assets, End of Period 37,192,298 33,494,414 37,497,699 41,359,176
Ratio of expenses to average net assets***** 0.6% 1.3% 0.7% 1.4%
Ratio of net income (loss) to average net assets -0.2% -0.5% 0.0% -0.9%
Portfolio turnover rate 40.4% 32.1% 101.0% 87.6%
Average commission rate paid per share for
portfolio transactions 0.0296 0.0332 0.0251 0.0258
* Period from August 30, 1999 (inception) to December 31, 1999
** Period from August 19, 1999 (inception) to December 31, 1999
*** Effective December 30, 1999, Wellington Management Company, LLP entered
into a Sub-Advisory Agreement with the Fund.
**** The period ended June 30, 2000 is not annualized but an aggregate total
return for the period.
***** 1999 ratio includes a one time organization expense.
ACTIVA Mutual Funds Semiannual Report 33
</TABLE>
<PAGE>
LOGO: Activa Mutual Funds
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(616) 787-6288 (800) 346-2670
www.activafunds.com
PRESORTED
STANDARD A
U.S. POSTAGE PAID
SOUTH SUBURBAN, IL
PERMIT #3602
Printed in U.S.A.
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